Have you been looking for a new investment? You can try real estate. Real estate can become a regular source of income throughout your work life up to retirement. You can also sell it when you need cash or leave it to your kids for inheritance.
How do you go about finding the next property to invest in Canada?
Well, you will need a real estate agent to guide you on the available properties in the market. Most people have a misconception about agents. That the agents may run off with your money without finding the right property for you. Though this is true if you meet scammers, the honest ones, however, do make your work easier.
To find the right real estate agent, you will need to ask for referrals from friends or families, or to do the leg walk yourself from office to office. You can also search online and get one immediately. If you are going to trust someone with your investment, it would be advisable to visit them in their office.
Open houses will also provide you with an opportunity to meet an agent.
Don’t let them feed you with market prices and future projections of the value of a property. Ask questions if you have any. Don’t be afraid to voice out your concerns. If you are looking for a condo or an apartment tell the agent your choice.
Listen to their advice but be the judge. More so, do your own research.
If you opt for a loan, then you will need to apply for a mortgage with financial institutions. Mortgages are usually 75% of the cost of the property. So you will need to raise the 25% from your pockets. The lender may have to conduct interviews with you to find if you are eligible for the mortgage. The approval may take a few days or longer depending on the bank and your financial status.
You can also choose to invest in real estate with a group of investors. It can be family or friends or even business partners. Investing in a group will help you spread out the risk of your investment. If there are significant losses on the property, you get to share with your partners.
When buying a property for investment, it is crucial to seek the services of a lawyer. Although they will cost you a few dollars, they will help you with the mortgage review, Agreement of purchase and sale, and search the title. These are things that will make your purchase straightforward. The charges will depend on the lawyer’s experience, the property, and location.
A professional accountant will come in handy for the purchase of the property. They can identify the little and minor costs incurred on the property such as insurance and interest fees. Accountants can also advise you on the best system for recording your income and expenses on the property to determine tax reports.
The taxes charged on your property will depend on the location of the property, income, and expenses. Consult both the lawyer and the accountant on projected taxes on the property.
Well, investment is not just about making money. There will be days when you have to spend money on maintenance of the property. If it is an apartment, maintenance may be a regular thing as tenants come and go as they wish. Some of the typical maintenance costs are; electrical, doors, windows, paints, locks, shelves and taps. Floors and ceilings may take a few years before they need maintenance unless you get ‘unique’ tenants.
Buying land instead of property
You can choose to buy bare land instead of property. This land can remain bare until its value appreciates so that you can resell it or you can find capital to build a property of your choice. However, for bare land to appreciate, you will need to be patient for a few years to see the difference in value.
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The information provided is for the clients' personal, non-commercial use and may not be used for any purpose other than to identify prospective properties clients may be interested in purchasing. All properties are subject to prior sale or withdrawal. All information provided is deemed reliable but is not guaranteed accurate, and should be independently verified. Greater Baton Rouge Assoc. of REALTORS® Last Updated: 6/18/2018 12:27:34 PM